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31/08/2012 01:27:55 PM
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Publish Date31/08/2012 01:27:55 PM
Last Update31/08/2012 01:30:46 PM
The World Bank has warned on Thursday that global food prices rose 10% in July from the month before, driven by the severe U.S. heatwave and the drought in parts of Eastern Europe were mostly to blame for the rising costs.
The Washington-based organization also added that maize and wheat prices rose by 25% from June to July, and soybeans rose by 17%, driving the World Bank`s Food Price Index that measures the price of traded food commodities 6% higher than July 2011.
The severe U.S. drought determined many farmers to abandon their 2012 harvest as more than half of the country`s corn crop was destroyed; and since the U.S. is the world`s largest exporter of corn and soybeans, food prices went sharply higher.
Corn futures jumped about 60% since the drought started in late June, and now they are trading above $8 a bushel, mainly as 40% of the U.S. corn production is used to produce ethanol biofuel becoming a key factor in the sharp rise in the US maize price.
The bank also warned that North and Sub-Saharan Africa and the Middle East will be particularly vulnerable to such price increases because much of their food was imported; yet the bank does not predict riots as in 2008.
Thereby the organization is urging governments to bolster programs to protect their vulnerable population, said World Bank President Jim Yong Kim.
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